A.M. Best Downgrades South Carolina Insurer

A.M. Best has downgraded the financial strength rating to B (Fair) from B+ (Good) and the issuer credit rating to “bb” from “bbb-” of auto insurer Greenville Casualty Insurance Co. based in Greer, South Carolina. The outlook for both ratings has been revised to negative from stable.

Due to the decline in policyholder surplus, the company’s owner made a cash contribution of $3 million in the first quarter of 2014.

A.M. Best said these negative rating factors are partially offset by Greenville’s other income and net investment income, which have been positive and have somewhat mitigated its unfavorable underwriting performance over the last five years. In addition, Greenville maintains a conservative investment philosophy as the majority of its invested assets consist of long-term bonds and cash and short-term investments.

The insurer, which sells through independent agents, is also licensed in North Carolina.

A.M. Best said the ratings may be downgraded if Greenville’s risk-adjusted capitalization continues to decline and/or there is a continuation of adverse operating performance. Removal of the negative outlook is “contingent upon improved capitalization and consistent and satisfactory operating performance,” the ratings agency said.
Source: A.M Best